Making America Great Again -- Another Multi-Billion-Dollar Petrochemicals Complex To Be Built In Louisiana

Making America great again: another huge chemical complex to be built in Louisiana. Here and here. Data points:

• $9.4 billion chemical complex
• 10-year building program; two phases
• construction to begin as soon as next year (2019)
• 1,200 new direct jobs averaging $85,000
• Formosa Petrochemical Corp (Taiwan-based)
• 2,400-acre site; along west bank of the Mississippi River
• will produce ethylene, propylene, ethylene glycol, and assoc polymers
• Formosa Plastics Group: no stranger to Louisiana; already operates three other facilities in the state
• this story will get very little media coverage; meanwhile, at only $5 billion, Amazon HQ2, will get much more media exposure

So Long, CA. Sayonara, NY: from the WSJ.

As the Trump tax cut was being debated in December, California’s Gov. Jerry Brown called the bill “evil in the extreme” and fumed that it would “divide the hell out of us.” He’s right—but in the end, this change could be good for all the states.

In the years to come, millions of people, thousands of businesses, and tens of billions of dollars of net income will flee high-tax blue states for low-tax red states. This migration has been happening for years. But the Trump tax bill’s cap on the deduction for state and local taxes, or SALT, will accelerate the pace. The losers will be most of the Northeast, along with California. The winners are likely to be states like Arizona, Nevada, Tennessee, Texas and Utah.

For years blue states have exported a third or more of their tax burden to residents of other states. In places like California, where the top income-tax rate exceeds 13%, that tax could be deducted on a federal return. Now that deduction for state and local taxes will be capped at $10,000 per family.

About 90% of taxpayers are unaffected by the change. But high earners in places with hefty income taxes—not just California and New York, but also Minnesota and New Jersey—will bear more of the true cost of their state government. Also in big trouble are Connecticut and Illinois, where the overall state and local tax burden (especially property taxes) is so onerous that high-income residents will feel the burn now that they can’t deduct these costs on their federal returns. On the other side are nine states—including Florida, Nevada, Texas and Washington—that impose no tax at all on earned income.

Tesla: the Big Four -- the US, Germany, Japan, and, now, China. From Bloomberg: 

That’s the master plan of billionaire Li Shufu, who has catapulted from founding Geely Group as a refrigerator maker in the 1980s to owning Volvo Cars, British sports carmaker Lotus, London Black Cabs and the largest stake in Daimler AG—the inventor of the automobile. Li is spearheading China’s aspirations to wedge itself among the big three of the global car industry—the U.S., Germany and Japan—so they become the Big Four.

He’s not alone: At least four Chinese carmakers and three Chinese-owned startups—SF Motors Inc., NIO and Byton—plan to sell cars in the U.S. starting next year. At the same time, Warren Buffett-backed BYD Co. is building electric buses in California; Baidu Inc. is partnering with Microsoft Corp., TomTom NV and Nvidia Corp. on a self-driving platform; and Beijing-based TuSimple Inc. is testing autonomous-driving big rigs in Arizona.

The industry is set for more upheaval as China unravels a two-decade policy that capped foreign ownership of carmaking ventures at 50 percent. The change may energize companies such as Volkswagen AG and Ford Motor Co. to seek a bigger piece of the world’s largest car market and allow Tesla Inc. to set up a fully owned unit. Carmakers may get better visibility of their futures, and those Chinese companies that fear losing sales at home may sense a greater impetus to go abroad.

The most prolific buyer is Li, who spent almost $13 billion on stakes in Daimler and truckmaker Volvo. Tencent Holdings Ltd., Asia’s biggest internet company, paid about $1.8 billion for 5 percent of Tesla. [Valuing Tesla at $36 billion.]

Tesla: trading at a mere 13,690 times its trailing EBITDA.  Forbes.

DAPL redux: Enbridge Line 3 ruling/protests already back in the news. The article provides a bit of background why Enbridge wanted a new route; it was not simply to be politically correct.

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